Masoud : EUR/USD Forex Forecast Weekly Review 30 Jan 12
Hello koala king and folks.
Good day to you.
The US Federal Reserve did not agree with raising interest rates and said interest rates in this country until 2014 will remain. This is done in order to further accelerate economic growth and to help the housing market too. Mr Bernanke, chairman of the US Federal Reserve has also announced that the unemployment figure is still bullish. However market prices have not seen inflation.
America’s economic growth in the final three months of 2011 has seen the fastest growth rate for sometime. However restoring the financial market and its exports early this year will be at a much slower rate. Graphs show the economy, the GDP of America, in 2008 and 2009 to -3.5 percent, and during 2011 to the average 1.7 percent, and in the fourth quarter of last year reached 2.8 percent.
The US Fed said this week that a full rebuild of America’s economy needs at least three more years. The percentage of unemployment is still growing. American consumers will spend money in this period from an increase of 1.7 percent to 2 percent. Much of this trend was due to increased sales of new cars which in the fourth quarter rose nearly 15 percent.
International Monetary Fund warned on Tuesday that America’s economy as well as other advanced economies “in front of the overflow of the debt crisis in the euro area is vulnerable.” Officials and economic experts attending the World Economic Forum in Davos were seeking to ensure that before the debt crisis in Europe takes down the global economy, action to resolve this crisis is taken. Europe’s problems will impact even the countries with strong economic growth such as Russia, Brazil, India and China.
Christine Lagard, president of the International Monetary Fund warned that government action to reduce current costs can lead to the reduction of economic growth. Ms. Lagard said that austerity plans can not be uniformly implemented in different countries and each nation’s own situation is unique. Mr Geithner, Treasury Secretary of America said that more restrictive policies without proper planning can trigger a vicious economic downturn but for parts of Europe, excluding debt relief will not be a solution. However George Soros, an American billionaire says that contractionary policies backed by Germany in the crisis-stricken countries of Europe which crisis might be caused by a decade of economic stagnation in Europe may cause destruction to the Union.
From a technical perspective: Last week, the EUR/USD continued its upward trend. While the EUR/USD is above the 1.2960 level, the main trend is upward and if it closes below 1.2960, it is a sign of a change in trend. The EUR/USD is located within an ascending channel. The currency pair has been rising to the ceiling channel. You can see in the above picture.
Have a great weekend.
Masoud.
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